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Officials: Southern Wisconsin, Rock County are benefiting from railroad's renaissance

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May 21, 2012
— The rail business is booming—one train spokesman calls it a renaissance—and is becoming an increasingly important piece of southern Wisconsin's economy.

"Some people might see it as a nuisance, but it means the economy is moving, particularly if those trains are stopping to load and unload," said Teresa Adams, a professor and director of the National Center for Freight and Infrastructure Research and Education, a consortium led by UW-Madison.


With rising fuel costs and rail's economies of scale, shipment of some goods has tipped in favor of rail over roads.


"It's one of those things that operates off the radar screen," said Jeff Plale, Wisconsin's railroad commissioner. "Nobody thinks about trains (unless) they hear that whistle, but it's a huge, booming industry."


The tracks of three rail companies crisscross Janesville, with the Wisconsin & Southern Railroad being the most active. Other companies are the Canadian Pacific and Union Pacific. Railroad companies in some cases share small sections of track.


On the national level, industry experts estimate rail traffic will double in the next 20 years.


'Railroad hub'

In the late 1980s, Wisconsin & Southern had about 15,000 cars operating on its system, Huntington said. That number is now 50,000.


Ken Lucht of Wisconsin & Southern said his company in 2012 expects a 9 percent increase in traffic beginning or ending in Rock County and an increase of almost 25 percent over three years.


Wisconsin & Southern has four lines that connect to Janesville, and it maintains 700 miles of rail in 21 counties in two states.


One line runs to Janesville from Milton and another from Whitewater. One goes west to Orfordville and Monroe. The main line heads southeast toward Walworth County and Chicago.


Wisconsin & Southern has a major terminal off Pearl Street that includes two switching yards, a repair garage and fueling station. It is building an off-site loading area, where trucks can exchange their cargo with trains.


"Janesville is really a vital railroad hub," Lucht said.


Some goods hauled by rail are produced in Janesville, and other goods, such as plastic pellets, are moved through Janesville.


Milton's ethanol plant ships its product by rail. Rising grain production means more rail shipments, and two companies are considering building new grain facilities on rail lines, Lucht said.


A grain elevator typically ships 3.5 million to 4 million bushels of grain annually, he said.


Silica sand for fracking—the process of extracting natural gas from shale rock layers—is transported from western Wisconsin through Janesville to the east, south and northwest, Plale said.


"So, when you combine all of these factors together—gas prices, abundance of grain and sand—it's kind of a perfect recipe to really fuel the rail industry," Plale said.


"Janesville is a big railroad town. Folks think of rail as something from the 1880s, but it is booming, and the industry is hiring like crazy," Plale said.


"Our past is our future."


'Renaissance period'

Wisconsin & Southern serves more than 180 businesses that employ more than 25,000 people, Lucht said. The railroad itself employs 240 people and is hiring.


"Nationally, the rail industry is in a renaissance period," Lucht said.


One reason is federal deregulation in the late 1980s, Lucht said. Smaller rail companies such as Wisconsin & Southern were able to provide local rail service.


"Federal regulation was choking the rail," he said. "We simply could not compete with trucks and barge traffic."


Federal regulations now are increasing in the trucking industry, he said.


Another reason is high energy prices. Rail can be more efficient because one carload equals four semitrailer trucks, Lucht said. The company last year hauled more than 55,000 carloads from Wisconsin, removing more than 250,000 truckloads from state highways.


It's an efficiency not lost on grain dealers.


"If you do the math, today's train can haul one ton of produce almost 485 miles on one gallon of diesel fuel," Lucht said.


That efficiency is second only to barges.


"We're not only saving the Wisconsin taxpayers in (road) maintenance costs, we're also improving public safety," he said.


Wisconsin & Southern sees Janesville as a growth area, with talk of opening track to the west, Plale said.


Serving business

When GM closed, Union Pacific lost about 35 percent of all railcar volume handled in Janesville, said Mark Davis of the railroad. Train sizes between Janesville and Chicago dropped from an average of 70 cars to 40 cars per train.


Business has been flat, although grain trains are strong with last year's harvest, chemical traffic continues to do well, and lumber has increased thanks to Universal Forest Products and Home Depot, Davis said.


Union Pacific continues to serves such customers as Landmark Services Co-op, Seneca Foods, Scot Forge and Evonik Goldschmidt.


Canadian Pacific Railway maintains a line to Janesville from Davis Junction in northern Illinois. It operates in 13 states and six Canadian provinces, said Andy Cummings, spokesman.


Its trains service Janesville businesses once or twice a week, and business has been consistent over the years, he said.


"We don't want to be the railroad that delays people," Cumming said. "The customers we serve are part of the employment base in the community. We help them do business and they enable us to do business," he said.


Janesville is in an enviable position, Adams said. The city has rail, Interstate 90/39 and an airport.


If one mode wanes because of outside factors, another is available to support businesses.



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